IRS Standard Mileage Rate Increases for 2018
The IRS recently announced the 2018 standard mileage rate for business travel would increase to 54.5 cents per mile. This is a 1 cent increase from the 2017 rate of 53.5 cents per mile.
Employers are not required to reimburse employees for mileage. Employees can deduct the cost of operating their vehicle for business purposes on their Form 1040 as non-reimbursed employee expenses. The standard mileage rate is an optional method for calculating the deductible cost. The employee can alternatively choose to calculate the actual expense of operating their vehicle for business use.
If employers choose to reimburse for mileage, they should collect documentation from the employee supporting the costs reimbursed. Many companies opt for an expense reimbursement log listing the date the expense was incurred, the total miles driven, and for what business purpose (client meetings, picking up supplies, delivering product, etc.) Microsoft Excel offers expense reimbursement log templates that can be customized to your company's needs. There are also several phone apps for tracking business mileage.